Contrary to popular belief you don’t need mega funds to start a business. You can bootstrap your business and create a sustainable and profitable business.
To bootstrap your business means to start with a limited budget and not get external funds for your business. The advantage of starting your business this way is that you will have sole ownership of your business, you won’t have someone hovering over your business and demanding to see it perform, and you will learn to be more efficient and creative in running your business. But how do you bootstrap your business?
Do what you know
It is important to start a business in a field you know and enjoy. This will ensure there is no steep learning curve to do business in your chosen industry. It is also important to start in an industry you know because you will have the insider know-how which you can’t learn from a book. Furthermore, it is crucial to remember to start small and grow as you make money.
Create a plan
It is often said “failing to plan is planning to fail” and this could not be truer than when you bootstrap your business. You need to have a clear plan of what you are going to sell and who is your target audience. You can learn more about business plans for specific industries here. You should also ensure your target market is growing.
Every entrepreneur looks at the offices of Amazon, Google, and Discovery and believes those kinds of office are needed to be successful. But you should be aware that some of those businesses were started in a garage when they began. If you do need office space to meet your customers every once in a while, you can consider hiring a co-working space for the time of your meeting. You should also try to use second-hand equipment where possible and viable. If you require specific software for your business, try to find a free version or use one which has a free trial for you to test the product before you invest in it.
You should not take prices at face value. If you are selling products try to negotiate the prices and payment methods with your suppliers to be a win-win situation for both businesses. You should also consider getting a quote from a few suppliers to see what the average rate should be that you should pay for your materials.
Consider profit over growth
Sometimes you will see a great business opportunity come which will boost your sales beyond your wildest imaginations but you need to be prudent. You should consider these questions before agreeing to take on the job of your dreams:
- Do you have the resources to do the job well?
- How will the job affect the work down for other customers?
- Is the job in line with your growth plans?
- Does the job validate hiring someone to concentrate solely on that job?
After careful consideration of these questions, you can decide whether to take the job or not.
Outsource before you hire
If the position can be fulfilled by a freelancer and it is cheaper than you should outsource the position. If the position is key to the running of your enterprise, then you should do it yourself or hire someone. You may want to market your business yourself in the beginning because you will be able to extend your passion for your start-up to those who meet.
By following these six tips you will be well on your way to creating a profitable and sustainable business which you own.
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